Don’t build a business to sell

A lot of early-stage startups that I meet want to talk about their exit strategy. They spend a lot of time figuring out how to build a company that they can sell for a good price.

If exit is your goal (and remember it may not be the only way to build something that meets your aspirations), then a strategy for exit is important. But making it a big focus from the get-go is wrong.

How about building something you might not want to sell? Ironically, you’re more likely to have created something really valuable, and would get higher offers.

More importantly, when and if acquisition opportunity knocks, if you love the business, you’ll have a genuine choice between selling or keeping the business. You won’t pressure yourself to take a bad deal simply because it’s what you’ve built all your expectations on.

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